Northern Shield Resources (NRN.V)-A “Moon Shot” speculation?
“Tier 1” deposits, the largest and highest value, are rare and it is just as rare for a junior explorer to generate green field prospects with the potential for a tier 1 discovery. I believe NRN is one such junior explorer and project generator, however, there are pro’s and con’s.
Pro’s
NRN has a very good technical team, and two very interesting projects. Both projects are located in the Labrador Trough, and are known as “Huckleberry”, about 100 km north of Schefferville and rail, and as “Idefix”, within 100 km of tide water near Kuujjuaq.
See a corporate fact sheet here:
northern-shield.com
Huckleberry: a new discovery of Cu, Ni, PGE + Au in the Huckleberry sill complex.
Discovery zone: continuously mineralized over 600 m strike length and up to 100 m wide. Samples average 1.4% Cu, .l2% Ni, 1.3 g/t PGE + Au
Western zone: 3 kilometer strike length, samples average 1.2% Cu, .2% Ni, 1.1 g/t PGE + Au
Eastern zone: 12 samples average .87% Cu
A high grade float boulder of brecciated anorthosite cemented by chalcopyrite at 4% Cu suggests potential exists for feeder zones like Voisey Bay, Noril’sk type massive sulphide near a feeder zone, or perhaps segregated Cu and Ni sulphide zones. If a high-grade feeder zone or adjacent massive sulphide zones are present, an airborne EM survey should highlight them and provide an indication of size, extent and depth.
See a “Huckleberry” fact sheet here:
northern-shield.com
More detail can be seen in a separate “Huckleberry” presentation here:
northern-shield.com
Idefix: prior work has identified kilometer scale Pt-Pd mineralization. Of interest, are massive Ni-Cu-PGE sulphide globules found in core over the entire kilometer scale length of PGE mineralization. These globules contain ~2% Ni, 4% Cu & 20 G/T Pd and are similar to globules seen adjacent to massive sulphide bodies at Noril’sk. If adjacent massive sulphide bodies are also present at Idefix, an airborne EM survey should highlight them and provide an indication of size, extent and depth. See an “Idifix” fact sheet here:
northern-shield.com
In summary, airborne EM surveys over Idefix and Huckleberry should identify massive sulphide bodies if present, and provide an indication of extent and size, resulting in very focused drill targets.
Cons
NRN’s share capitalization is already about 166 mm shares fully diluted. Over the last two months, the stock has infrequently traded between $.01 and $.02. The chart appears to have been in a base forming mode over at least the last two years with no sign yet of a break out. Below is a link to a 10-year chart for NRN.
stockwatch.com
The treasury is near depleted and financing is required. I estimate airborne EM surveys over both Huckleberry and Idefix, could cost about $500K all in plus another $250K is needed for ongoing G &A for 12 months. At say $.05/share, that would add another 15 million shares to the share capitalization.
Commodity prices are low, appetites for green fields exploration appear to be low, and equity markets for miners and junior exploration companies are at or near their lows, however, management has demonstrated over the last decade or more, their ability to raise equity funds to advance projects of merit, and to leverage technical and intellectual capital, and projects by joint venturing.
Conclusion:
Both Huckleberry and Idefix are excellent green fields exploration prospects for “tier 1” deposits. Subject to financing one or both prospects, successful airborne surveys would provide an indication of size and extent of massive sulphide deposits, resulting in focused drill targets, which should attract additional funding and a jv partner, regardless of market conditions. On a result driven basis, 2016 could prove to be an interesting and exciting year for NRN, and with a little luck, NRN may become one of those rare “moon shot” speculations.
NOTE: for those attending the PDAC, NRN will be exhibiting at booth 3037
Disclosure: I have taken an initial position. And have no affiliation with NRN. The commentary is entirely my opinion based on my research. |
